Budget Transparency Is Overdue at the DWP

Like the Los Angeles Harbor Department and Los Angeles World Airports, the Los Angeles Department of Water and Power is a rarity in L.A., an area of city government that generates revenue.

Last spring, the City Council was caught off guard by the decision of  LADWP’s Board of Commissioners to withhold the transfer of $73.5 million to the city’s general fund, unless the City Council approved a rate hike  of up to 28 percent for some customers. Remember, the surplus funds were generated by Los Angeles residents for a nonprofit public utility owned by the city's residents themselves.

According to an audit in June by City Controller Wendy Greuel, the utility had no reason to withhold the funds contingent on approval of a higher Energy Cost Adjustment Factor, ECAF. "It's hard to look at these numbers and not say that the DWP was trying to extort the City Council into passing its proposed ECAF increase," Greuel said.  

Measure J would amend the city charter to force LADWP to coordinate its budgeting with the rest of the city. It would require the utility to submit a preliminary budget to the City Council by the end of the fiscal year’s third quarter, March 31, so that the city has a full quarter to work with it before the new fiscal year, which begins July 1.

Measure J would eliminate last minute surprises like the one that angered the City Council last year. It would lead to greater transparency at LADWP and deserves a yes vote.